Highest number of bogus and fake sales tax refund claims are filed from Karachi. This was stated by Collector, Sales Tax and Central Excise (Audit), Ajaz Ali Jafri, on Tuesday.
Addressing the GST and refund subcommittee of Karachi Chamber of Commerce and Industry (KCCI) on Tuesday, he said that a few years back a huge number of refund claims were filed and received on the basis of fake invoices by the business community of Lahore, Faisalabad, Gujranwala and other cities of Punjab. Now the trend has changed, and Karachi is on top.
He said that efforts are being made to improve the refund system and detect fake claims and apprehend the filers while remaining within the framework of law
He said that there was no change is the sales tax audit law and as per law once a year audit would be conducted of all registered firms and persons. There is no audit of clearing agents and CNG dealers while audit of zero-rated sector and steel sector would be conducted.
However, commercial importers have got relaxation of audit under law. The department has authority to conduct verification of commercial importers. If the profile is extraordinary, then audit will be conducted, he added.
The Collector said that CBR reform process was started as back as 2002 and CBR was converted into Federal Board of Revenue (FBR). There is still enough room for improvement in FBR, he added.
He emphasised the need of frequent contact between all departments of FBR, chambers and associations to resolve issues on permanent basis.
KCCI President Anjum Nisar said that the country was facing serious economic crisis, frequent power outrages, high power and gas tariffs, ever-increasing cost of doing business and in these circumstances any more harassment of business community would prompt them to react. KCCI senior vice president Jawed Bilwani said that sales tax audit was issuing audit notices and conducting illegal raids to harass the business community. He demanded immediate halt of issuing notices and raids.
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